Diebold Elections Systems, Inc. is
no more. At least in name

After a year and a half
of conversely trying to dump their failed voting unit and/or
lying to customers about the reliability and security of
their voting systems, corporate parent Diebold is giving up
the ghost of their election business which, according to an
analyst in a Reuters report, was "responsible for less than
10 percent of Diebold's revenue, and 100 percent of its bad
publicity."

According to a company statement [PDF] just
released, Diebold Elections Systems, Inc. will become
Premier Election Solutions as of today. The company
president, David Byrd, who has overseen the disastrous
election unit for some time, will stay on as President to go
down with the ship, apparently.

Applying full lipstick to
the pig, the company statement declares, "The change to
Premier signals a new beginning for the company." And
President Byrd picks up where he left off, furiously
polishing his turd, with the claim that "This is both a
fresh identity for our company and a unique opportunity for
us to concentrate our focus solely on proving best-in-class
elections solutions for current and potential
customers."

No word on when they'd begin that "focus"
after years of claiming same, but doing anything but. They
have, however, radically lowered their expected revenue
statement for the year by $120 million.

After a string of
disastrous reports on the quality and security of their
voting systems, along with plummeting stock prices since
last week, it seems clear that Diebold, the once-great,
more-than-100-year old company, is doing whatever they can
at this point to save the corporate parent. While their
stock price (DBD) plummeted at today's opening bell, and is
currently down some 5.6% from yesterday, the price has begun
to rise again in the last hour or so on news of the
sale.

More than anything, however, the move may well be a
harbinger of a coming declaration of bankruptcy for
Diebold/Premier as we see it. With the unit now spun off
from the blue chip Diebold parent, declaring bankruptcy or
dissolving the company all together might be less trouble
for investors and the main company as a whole, as their
extraordinary legal and financial liabilities continue to
mount...

The BRAD BLOG has speculated in the past that
voting machines companies such as Diebold, and Sequoia
Voting Systems, whose corporate parent Smartmatic has also
been unsuccessfully seeking a buyer for some time, will
likely have trouble unloading their units given the
extraordinary liabilities all of these companies now likely
face after years of producing shoddy equipment and
attempting to defraud both the public and Election Officials
about the quality, security, service and price of their
hastily built voting systems.

A devasting exposé by "Dan
Rather Reports" aired on Tuesday night (complete video here)
will likely make Sequoia even more difficult to unload. The
investigative report detailed seven Sequoia plant workers
who testified on camera, about a mysterious order to use
inferior paper on the company's punch card ballots to be
used in Florida during the 2000 election. As well, they were
told --- despite the objections of the plant's quality
control manager --- to change the alignment on the punch
card chads being sent to Palm Beach County. Rather's report
tested the inferior, misaligned ballots that were sent to
the county anyway, in 2000, and found that "hanging chads"
resulted on ballots that had punched through cleanly for
years before the bad paper and re-alignment was forced by
still-unnamed company officials.

In the wake of Rather's
report, election watchdog group, Voter Action, has called
for a Congressional investigation into allegations of
"commercial fraud" by all of the voting machine
vendors.

In Diebold's statement announcing the
restructuring this morning, they admitted that "efforts to
sell this company...have proven unsuccessful." Instead of
blaming the failure on their hackable, inaccurate,
inaccessible voting systems, they claim the move was "due in
part to the rapidly evolving political uncertainties and
controversies surrounding state and jurisdiction purchases
of electronic voting systems."

Diebold's voting systems
have been found in study after study to have severe
problems. But the final blow may well prove to have been the
recent findings by California Secretary of State Debra
Bowen's independent "Top-to-Bottom Review" of all voting
systems certified in the state. The devastating reports, by
computer scientists at the University of California, found
that Diebold's voting systems were easily hacked in just
minutes time and even failed to meet disabled voter
accessibility standards as mandated by federal law.

Bowen
decertified Diebold's touch-screen systems beyond the use of
one unit per polling place in order to marginally meet those
federal disabilities standards. All of the systems
unreliable "voter verified paper audit trails" will have to
be counted, 100%, by hand. Since the latest findings in the
Golden State, other states and counties have begun to
reexamine their own use of the flawed systems.

Angling,
perhaps, for the "Understatement of the Year Award", Diebold
spokesman Michael Jacobson downplayed the importance of
California's actions, suggesting to PCWorld today that
Bowen's moves "played a small part in the decision to
restructure the business unit and lower revenue
expectations."

The company announced today that they were
"lowering [their] full-year revenue expectations for the
election business by approximately $120 million" from their
previous estimates for the year of "$185 million to $215
million."

While we're no financial analysts, the
adjustment would seem to lower expected revenues from more
than $200 million to a paltry $65 to $95 million, by our
rudimentary math.

"This is a cumulative effect. There's a
lot of activity in a lot of states," Jacobson understated to
PCWorld.

Last year, Diebold admitted that they were under
"formal" investigation by the SEC, reportedly due to
allegations of misstatements to investors concerning revenue
projections their voting machine sales and long-term service
contracts.

As well, the company is currently defending
themselves in Securities Fraud Class Action lawsuit filed in
December of 2005, charging fraud, insider trading,
manipluation of stock prices and concealment of known flaws
in their voting machines.

Those of us in the Reality Based
World, however, paying close attention to Diebold's various
attempts to re-arrange the deck chairs on their Titanic,
have been noting all of these glaciers in the water for some
time. Diebold CEO, Tom Swidarski might have been wise to
take up our offer for advise on what was wrong with his
company back when we offered it in March of 2006, just after
former CEO Walden O'Dell had finally been pushed
overboard.

O'Dell, a George W. Bush "pioneer", having
raised more than $100,000 for the Bush/Cheney '04 campaign,
while he led the North Canton, Ohio company, had infamously
--- and disastrously --- brought Diebold to the center of
attention for e-voting critics when he wrote that he was
"committed to helping Ohio deliver its electoral votes to
the president next year" in an ill-advised Republican fund
raising letter back in 2003.

The company has been forced
to defend itself against charges of corruption and vote
rigging ever since. But while it hasn't been shown that
Diebold has actually thrown any elections, myriad findings,
including California's reports and a study last year at
Princeton University, have shown that both the physical and
software "security" on their systems are easily violated and
could allow a single user with access to just one of their
voting machines to implant an undetectable computer virus
that could flip an election without detection. The
University of California also found an undocumented user
account that could allow company employees to access and
take over the entire voting system remotely without use of
even a password.

The newly named company, Premier (while
its still in business) will remain headquartered in Allen,
TX, where we visited them a week or so ago. Our recent
late-night visit to the building, the day after Bowen's
decertification/recertification of their voting systems is
documented, with photos, right here.

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